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Vermont Health Benefit Exchange: Design
Advisory Group Meeting 1Monday, March 7, 2011
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Today’s Agenda
Context -- ACA Exchange Requirement-- Single Payer Bill
Exchange Overview-- Major Structural Issues and Decisions-- Roadmap for Establishing an Exchange in Vermont
Background: Vermont Health Insurance Market -- Study of Uninsured -- Overall Insurance Trends-- Individual market-- Small employer market
Next Steps
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ACA Exchange Requirement
Must establish American Health Benefit Exchange (AHBE) by 1/1/2014 or HHS will establish for VT
Exchanges may be administered by a Governmental Agency or a non-profit entity
Exchanges may be organized at a multi-State, State, or a regional level
VT must decide on the structure of their Exchange by 1/1/2013
Federal government provides planning and start-up funds but must be self sufficient by 2015
Does Vermont need to Establish an Exchange?
Context
Key Functions of the Exchange
Determine and Coordinate Eligibility Create standardized benefit categories of
health insurance plans Offer multistate plans Certify Qualified Health Plans Maintain a call center for customer service and
establish procedures for enrolling individuals and businesses
Establish website Assign quality ratings Reward Quality Set up a “Navigator” program
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Context
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Vermont Single Payer Bill - 2011
3 Stages:
Stage 1: Begins 7/11 Establish Health Benefit Exchange and Health Reform Board
Stage 2: Exchange operational 2014
Stage 3: Vermont Single Payer no later than 2017; earlier if possible
Context
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Goals for Vermont’s Exchange
Can easily transition to single payer
Facilitates purchase of affordable, qualified health plans in individual and group market
Reduces the number of uninsured and underinsured Vermonters
Reduces administrative costs and improves quality of health care
Reduces disruptions during income and employment transitions
Promotes health, prevention, and healthy lifestyles
Major Structural Issues & Decisions
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Governance of Vermont’s Exchange
Vermont will create its own Exchange
Exchange will be a separate Division within DVHA
Deputy Commissioner will lead the Exchange
Exchange leadership will consult with health reform board
Major Structural Issues & Decisions
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Major Issues and Decisions
Vermont will establish one Exchange for individuals and businesses
Upon approval from federal government Vermont’s Exchange will serve: Large employers including state and municipal employees Medicare and Medicaid recipients Worker’s compensation recipients
Vermont’s Exchange will selectively contract for Qualified Health Plan(s)
Vermont’s Health Exchange will collect premiums from individuals and employers
Major Structural Issues & Decisions
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Process for Designing Exchange
Existing Data Sources
Exchange Overview:Roadmap
10 years survey data on uninsured
Multi-payer data set with commercial claims
Health Information Exchange
Robust Medicaid Management Information System
(MMIS)
Data Warehouse
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Process for Designing Exchange
Analysis to be completed
Exchange Overview:Roadmap
Targeted analysis of existing uninsured data
(today)
Survey of commercial payers on benefit design
Stakeholder study
Analysis of financial functions to be performed by
Exchange
Analysis of financial sustainability options
Writing of briefing memos around topical areas
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Establishing the Exchange
Structure of Exchange
Exchange Overview:Roadmap
Vision for Vermont’s Exchange
Governance of Vermont’s Exchange Location
Size of the Exchange Purchasing through the Exchange One Exchange for businesses and individuals Expanding Exchange’s reach
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Questions for Establishing ExchangeInteraction with Public Programs
Exchange Overview:Roadmap
How will Exchange interact with other public programs? What opportunities exist to leverage new eligibility system?
How to address potential timing issues of two systems? Evaluate existing e-mail and web portal and consider face-to-face and telephone options
How will outreach be conducted? How can Vermont ensure “no wrong door”? Should Vermont develop Basic Health Plan? Will the same plans be offered through Exchange as other Vermont public programs?
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Questions for Establishing Exchange
Interaction with the Insurance Market
Exchange Overview:Roadmap
How will Exchange market interact with outside
market? How will ACA required MLRs and rating rules affect
Vermont? How will Vermont address any issues of adverse
selection? Is a merging of non-group and small group markets
advisable in 2014? Will products in both markets be the same? How will Vermont address any differences in essential
benefits?
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Questions for Establishing Exchange
Business Operations
Exchange Overview:Roadmap
How will operations differ for individuals and businesses? How will Vermont market the Exchange? How will Vermont’s Exchange address enrollment issues? How will the Navigator program be implemented? How will web portal operate and what information will be available on the web? How will the Exchange procure and certify plans? How will the Exchange interact with employers? What capital investment is needed for Exchange and how will it become financially sustainable?
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Characteristics of Uninsured Adults Aged 18-64 in 2009
The percentage of uninsured residents in Vermont has decreased significantly since 2005.
Background: Uninsured Study
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Characteristics of Uninsured Adults Aged 18-64 in 2009Among the 18 to 64, uninsured rates were highest among those:
.
Background: Uninsured Study
Aged 18 to 24 (17%) Aged 25 to 34 (16%) Residents of Essex County (17%) With family incomes between 134% and 200% of FPL (22%) Those in single adult households without children (24%) Among the employed, those earning between $9.00 and $15.00 per hour (20%) Employed by companies with 50 or fewer employees (19%)
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Characteristics of Uninsured Adults Aged 18-64 in 2009Within prior 12 months, uninsured adults report they are less likely to have a usual source of care, receive medical care and more likely to experience hardships.
.
Background: Uninsured Study
42% did not have a usual source of care
40% had not visited a health care provider
52% had not received routine or preventive care
19% did not receive needed medical care, 35% dental care and 13% did not fill a needed prescription
43% experienced problems paying medical bills
35% were contacted by a collection agency about unpaid bills
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Characteristics of Uninsured Adults Aged 18-64 in 2009
Based on existing programs, about 1/3 of uninsured adults were eligible for coverage through Medicaid or VHAP.
.
Background: Uninsured Study
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Characteristics of Uninsured Adults Aged 18-64 in 2009
Under PPACA Guidelines, 85% of uninsured adults would qualify for coverage through Medicaid or be eligible for subsidies to assist in purchasing health insurance.
Background: Uninsured Study
Count Rate
Eligible for Medicaid 13,399 31%
Income 133% - 150% FPL 2,558 6%
Income 150% - 200% FPL 6,684 15%
Income 200% - 250% FPL 5,357 12%
Income 250% - 300% FPL 4,099 9%
Income 300% - 400% FPL 5,198 12%
Income > 400% FPL 6,481 15%
Total 43,776 100%
Among the 3,626 uninsured children:77% were eligible for coverage through existing programs (Medicaid or Dr. Dynasaur), an additional 4% lived in families that would be eligible for subsidies to assist in purchasing health insurance.
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Characteristics of Underinsured Adults Aged 18-64 in 2009
Economic definition of uninsured: Does an insured person have the ability to pay for health care needs and out of pocket costs?
.
Background: Uninsured Study
Examined at family level for people with private health insurance only
Among those whose incomes are less that 200% FPL: Actual out of pocket expenses excluding monthly insurance premiums that exceed 5% of a family’s annual income.
Among those whose incomes are greater than 200% FPL: Actual out of pocket expenses excluding monthly insurance premiums that exceed 10% of a family’s annual income; or
A deductible for a health insurance plan that exceeds 5% of a family’s annual income.
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Characteristics of Underinsured Adults Aged 18-64 in 2009
Reason why resident is classified as underinsured:.
Background: Uninsured Study
Rate
< 18 18 - 64
Underinsured due to deductible 53% 40%Underinsured due to health care expenses 27% 32%Underinsured due to both deductible and expenses 20% 29%
Total 100% 100%
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Characteristics of Underinsured Adults Aged 18-64 in 2009
Among the privately insured the rates of underinsurance were highest among those:
Background: Uninsured Study
Aged 18 to 24 (39%)
Residents of Bennington County (41% among adults and 34% among children)
In single adult households without children (58%)
The percentage that were classified as underinsured decreases sharply with rising income.
Families purchasing their insurance directly were much more likely to be underinsured (51% of adults and 48% of children).
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Characteristics of Underinsured Adults Aged 18-64 in 2009
A significant percentage of the underinsured experience financial hardships:
Background: Uninsured Study
Rate
< 18 18 - 64
Were there times that there were problems paying for medical bills for anyone in your household?
40% 33%
Was anyone in your family contacted by a collection agency about owing money for unpaid medical bills?
22% 19%
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Characteristics of Underinsured Adults Aged 18-64 in 2009
Under PPACA, 88% of underinsured children and 81% of underinsured adults would qualify for coverage through Medicaid or would be eligible for subsidies.
Background: Uninsured Study
< 18 18-64Eligible for Medicaid 16% 19%
Income 133% - 150% FPL 2% 4%
Income 150% - 200% FPL 16% 13%
Income 200% - 250% FPL 21% 14%
Income 250% - 300% FPL 9% 11%
Income 300% - 400% FPL 25% 20%
Income > 400% FPL 12% 19%
Total 100% 100%
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Exchange Advisory Group Meetings
Meeting 1: 3/21/2011Background and Roadmap
Meeting 2: 4/4/2011Interaction and Integration
Meeting 3: 4/25/2011Business Operations
Meeting 4: 5/9/2011 Business Operations & Financing
March April May